International Journal of Finance & Banking Studies

This paper demonstrates the relationship between CAMELS ratios and credit ratings of deposit banks in Turkey. Annual data was used for the period between 2004 and 2014 in this study. Moreover, 20 deposit banks of Turkey were analyzed and 21 different ratios of CAMELS components were used. In addition to that, credit ratings of these banks were provided from Moody’s corporation or annual activity reports of the banks. After that, we created multi nominal logistic regression analysis in order to illustrate the relationship. The major finding in this study is that three components (Asset Quality, Management Quality, and Sensitivity to Market Risk) of CAMELS have effects on credit ratings whereas the ratios related to Capital Adequacy and Earnings are not effective. As a result, it was recommended that Turkish deposit banks should concentrate on the percentage of fixed assets and interest income to have a better rating. Moreover, having high market share with respect to total assets and lower interest expense are also other important points for this purpose. On the other hand, Turkish deposit banks should control the proportion of financial assets and increase the amount of FX liquid assets to prevent credit ratings to decrease. Additionally, market share of banks for loans should not reach at high level for this objective.

The study attempts to ascertain the determinants of nonperforming loans in National Bank of Commerce. Data was collected from 152 respondents. Tables, percentages, mean and standard deviation were used to analyze data. Data collection methods adopted for the study were interview, questionnaire and documentary evidence. Interest rate, GDP, concentration of lending activities, bank’s loan supervision capacity and economic condition were investigated, and the results suggest that interest rate, GDP, bank’s loan supervision capacity and economic condition influence the level of NPLs. However, the results did not suggest that concentration of lending activities increase the level of NPLs.   The study suggests that banks should put in place a vibrant credit process that ensures proper customer selection and risk identification, robust credit analysis, proactive monitoring and clear recovery strategies for bad loans, formulate clear policy framework that addresses issues of ethical standards and check and balance credit process, organizational capacity enhancement of banks, deliberate effort to develop credit culture for managing loans ,and ensure prudent policies that govern bank loans. Since the results for this study were encouraging, the researcher encourages replicating the study for other lending institutions. In order to extend the literature on non-performing loans, the researcher suggested incorporating models of Golem effect, Social loafing, Inverted pyramid effect, Pollyanna effect and High default culture effect.  Also, basing on the merits of the study, the researcher suggests determining relationship between non-performing loans and loan size, collateral, credit culture, and credit management information system.

The positive of impact of market orientation toward business performance of a company is a common wisdom in the marketing literatures. Hence the prior studies recommend that the connection will depend on other strategic actions. In this regards, this study tries to assess the construct of business ethics as the precedent of market orientation in the context of Indonesia Islamic banks. Upon assessing data using SmartPLS, this study finds that market orientation is the determinant of business performance and Islamic business ethics is the precedent of market orientation. However, market orientation is not effective as the mediator in the relationship between Islamic business ethics and business performance. The discussion of this finding is provided as well as the managerial implication at the end of this paper.

A well-functioning financial institution will sustain a countries economic development and play a great role in reduction of poverty. One of the major participants in the financial institution is the banking industry.  However, the mal-functioning of the banking system can be extremely costly to the real economy. As Bank is one of the participants and major key player in the financial institutions, it needs a continuous assessment by its supervisory and management. Mere ratio analyses are commonly used Performance measurement among the banking industry in Ethiopia. Nonetheless, these financial ratios are more of traditional as well as partial measurements. As such this study conducted using CAMEL framework set by bank for international settlement. The study takes secondary data which are gathered from audited annual reports of all banks. The result shows CAMEL framework is the best fit measurement for Ethiopian Banks and it give a comprehensive result which is very helpful for the governor to set a well determined policy and procedure.

In this paper, we examine the impact of CEO power on auditor choice. We are motivated by the competing financial reporting incentives arising from CEO power. Our empirical finding suggests that powerful CEOs are more likely to hire high-quality auditors as a signal of superior financial reporting quality. We contribute to the literature of auditor switch and extend the research on the links between CEO power and firm behaviors.

In this paper, we examine the impact of CEO power on auditor choice. We are motivated by the competing financial reporting incentives arising from CEO power. Our empirical finding suggests that powerful CEOs are more likely to hire high-quality auditors as a signal of superior financial reporting quality. We contribute to the literature of auditor switch and extend the research on the links between CEO power and firm behaviors.

The competence of a financial system is entirely depending upon the stock market efficiency. The gradual growth of equity investor’s participation is inevitable to enrich the overall growth of emerging economies.Hence the necessity is felt to provide an empirical support to the investing community. For the purpose, this study attempts to examine the weak-form efficiency of Indian stock market – National Stock Exchange (NSE). The study has used the daily closing price of the Nifty fifty stocks from 3rdJanuary 2011 to 24thApril 2015. To test the weak form efficiency both parametric and non-parametric tests called Autocorrelation, Augmented Dicky Fuller test, and Runs Test were performed.  The study reveals that 39 stocks of NSE-Nifty Fifty are found to be weak form inefficient, so that the investors can formulate trading strategies to gain abnormal returns. The Index and 10 stocks are found to be weak form efficient during the study period since the price series found to be autocorrelation existence.

Conditionality is mostly defined as the EU policy engendered for candidate countries. However, the mere use of conditionality by the EU does not essentially explain transferring of policies and EU rules towards the candidate countries. EU conditionality may be considered as a comprising approach but in certain policy areas or countries it might not be as successful as it was on other ones. The EU conditionality basically defined as a bargaining policy of affecting through reward, under which the EU provides inducements to candidate or neighbor countries to aligning with the conditions of the EU. In this study the explanatory power of conditionality would be questioned; so the main question will be “to what extent does the EU have influence on policy convergence in a candidate country that does not have a clear membership perspective? Taxation chapter in accession negotiations between Turkey and the EU has been chosen as the case of this research as providing to have an answer on this question. The main objective of this paper is ‘analyzing the extent of EU conditionality on Turkish taxation policy.’ Furthermore, it is argued in this study that “without a concrete incentive, European Union’s impact on a candidate country would be limited.” 

The Chinese stock market is an emerging market that has gained much importance over the past few decades. Because of this, it also serves as a great subject for studying market inefficiencies and anomalies. In this paper we provide a review of evidence regarding the development, efficiency and integration of the Chinese stock market. In particular, we review recent literature in the areas of market segmentation, cross-listings and calendar effects. This provides evidence of market inefficiency in China. We also pose questions that can be answered in future studies.

This paper demonstrates the relationship between CAMELS ratios and credit ratings of deposit banks in Turkey. Annual data was used for the period between 2004 and 2014 in this study. Moreover, 20 deposit banks of Turkey were analyzed and 21 different ratios of CAMELS components were used. In addition to that, credit ratings of these banks were provided from Moody’s corporation or annual activity reports of the banks. After that, we created multi nominal logistic regression analysis in order to illustrate the relationship. The major finding in this study is that three components (Asset Quality, Management Quality, and Sensitivity to Market Risk) of CAMELS have effects on credit ratings whereas the ratios related to Capital Adequacy and Earnings are not effective. As a result, it was recommended that Turkish deposit banks should concentrate on the percentage of fixed assets and interest income to have a better rating. Moreover, having high market share with respect to total assets and lower interest expense are also other important points for this purpose. On the other hand, Turkish deposit banks should control the proportion of financial assets and increase the amount of FX liquid assets to prevent credit ratings to decrease. Additionally, market share of banks for loans should not reach at high level for this objective.